Ed072400
CITY OF NEW HOPE
4401 XYLON AVENUE NORTH
NEW HOPE, MINNESOTA 55428
Approved EDA Minutes July 24, 2000
Regular Meeting City Hall
CALL TO ORDER President Enck called the meeting of the Economic Development Authority to order
at 9:13 p.m.
ROLL CALL Present: W. Peter Enck, President
Sharon Cassen, Commissioner
Don Collier, Commissioner
Pat LaVine Norby, Commissioner
Mark Thompson, Commissioner
APPROVE MINUTES Motion was made by Commissioner Thompson, seconded by Commissioner Norby,
to approve the Regular Meeting Minutes of June 26, 2000
. All present voted in
favor. Motion carried.
TAX INCREMENT President Enck introduced for discussion Item 4, Discussion Regarding Request for
FINANCING Tax Increment Financing Assistance for Avtec Building Expansion and Regional
ASSISTANCE Stormwater Pond Improvements, 9101 Science Center Drive (Planning Case No.
Item 4 00-11).
President Enck noted the issue of Avtec’s building expansion was on the Council
Meeting agenda. The item before the EDA is regarding tax increment financing
assistance.
Mr. Kirk McDonald, Director of Community Development, stated Wilson
Development Services, representing Avtec Finishing Systems, is in the audience.
Mr. McDonald stated the major issues discussed during the development review
process was storm water quality improvements. Avtec’s property includes a
triangular-shaped piece of property southeast of the existing building and east of the
rail spur. The building expansion requires storm water ponding improvements to
meet the property owner’s current expansion plans and the plans denote a pond in
the area which has been approved by the City Engineer and Watershed District.
However, the City Engineer has discussed the need for a larger regional pond in this
area that would address water quality issues from adjacent and surrounding
properties with expansion in the future. There has been some discussion of having
Avtec place funds in escrow and deferring their ponding improvements to allow
time for the City to coordinate with other properties in the area on regional pond
issues, with the City potentially acquiring the property for ponding purposes. The
Watershed District favors the regional pond approach.
He stated Avtec is requesting the City to consider creating an Economic
Development Tax Increment Financing District to assist them with extraordinary
development costs and to assist the City with the future construction with a regional
NURP pond including property acquisition and trail access. It is estimated that the
proposed building expansion would generate between $150,000 and $185,000 in
TIF funds over the next eight years (after the 40% fiscal disparity allocation is
paid). The TIF statutes also provide for a loss in local government aid and require
that the City participate in the project by making a 10% annual contribution. If the
New Hope EDA July 24, 2000
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City proceeded with this project, it is anticipated that the 10% would be contributed
from the Storm Water Fund or other non-general fund tax sources used for pond and
trail improvements. Avtec is requesting that they be paid $125,000 of the TIF
proceeds for a portion of the TIF eligible expenses and sale of the land (for the
pond) to the City under a “pay-as-you-go” arrangement. The additional $25,000 -
$50,000 in TIF generated funds would be available to the City for administrative
expenses and public improvements associated with the project.
Mr. McDonald stated if the EDA is interested in pursuing this request, the first step
recommended by the City Manager is to bring in a financial consultant to review the
figures.
City Attorney Sondrall noted this type of contribution may be subject to the
business subsidy laws.
Mr. Daniel Wilson, Wilson Development Services, was recognized. He stated the
tax increment mechanism is a viable way to acquire ponding and trail
improvements. He noted there are extraordinary development costs for the site due
to unstable soil conditions and configuration as well as the construction of a NURP
pond. Mr. Wilson stated timing is a critical factor for Avtec.
Mr. Wilson commented that the business subsidy criteria would apply as an
additional 12 jobs would be generated.
President Enck noted that pond maintenance is a long-term obligation for the City.
The EDA directed staff to utilize services of a financial consultant and present a
preliminary report at its next meeting of August 14, 2000. Mayor Enck emphasized
the need to consider development costs as well as maintenance costs for the pond.
President Enck introduced for discussion Item 5, Resolution Establishing a Business
BUSINESS SUBSIDY
Subsidy Criteria Pursuant to Minn. Stat. 116J.993 – 116J.995.
CRITERIA
Item 5
EDA RESOLUTION Commissioner Cassen introduced the following resolution and moved its adoption:
00-03 “RESOLUTION ESTABLISHING A BUSINESS SUBSIDY CRITERIA
PURSUANT TO MINN. STAT. 116J.993 – 116J.995”.
Item 5 The motion for the
adoption of the foregoing resolution was seconded by Commissioner Collier, and
upon vote being taken thereon, the following voted in favor thereof: Enck, Cassen,
Collier, Norby, Thompson; and the following voted against the same: None;
Abstained: None; Absent: None; whereupon the resolution was declared duly
passed and adopted, signed by the president which was attested to by the executive
director.
ADJOURNMENT Motion was made by Commissioner Thompson, seconded by Commissioner
Cassen, to adjourn the meeting. All present voted in favor. Motion carried. The New
Hope EDA adjourned at 9:42 p.m.
Respectfully submitted,
Valerie Leone
City Clerk
New Hope EDA July 24, 2000
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